Budget 2024 will outline the Government's economic plans, taxes, and spending for the following year. New Chancellor Rachel Reeves will announce her first budget on the 30th of October and is expected to bring about some significant changes ...
Budget 2024 may be a one-day event, but its effects will be felt for a long time!
Having only been in power for a few short weeks, Labour has already announced some measures which have raised eyebrows, and despite promising not to during their election campaign, it's now clear that taxes will be rising.
"Firstly, we got VAT on private school fees!"
Although this doesn't affect a lot of people, I've always found this a strange policy because the rich won't notice the increase and the struggling middle classes will have to send their children to already underfunded state schools as they won't be able to afford the extra 20% on their fees.
Most recently, it was announced that the Winter Fuel Payment will become means-tested so millions of pensioners will no longer get an extra £200 to help heat their homes. The Government will also abolish the Furnished Holiday Let rules so many landlords will sell up and non-dom status will be removed, so lots of people with money will be leaving the country, taking their investments with them.
"And we haven't even got to the Budget yet!"
I'm not sure I believe the Government when they say that workers won't see any uptick in taxes. I'm pretty sure there'll be a surge in inflation after such massive public sector pay rises (which will have to be matched for all public servants now) so in real terms, workers in the private sector will be worse off.
Capital Gains Tax will be reformed, as will be Inheritance Tax, and the new Government will double down on green spending in an attempt to hit our climate change targets on time. They're increasing the Energy Profits Levy to 38% which will push up everyone's bills as well as abolishing the investment allowance for qualifying expenditure.
There will definitely be Budget announcements around immigration, the NHS and welfare and I'm sure they'll want to uplift the National Living Wage soon as well.
What's going to get cut though? Defence? I don't think the Army can cope with any further reduction in personnel and I believe they'd be mad to not stick with 2.5% in the face of Russian aggression in Ukraine. God forbid they cancel our nuclear subs simply because the Chancellor has found a £ 20 billion budget hole unreported by the Office of Budget Responsibility.
I'm sure I'll be writing more in the coming weeks and I'm hoping it's not all going to be doom and gloom for businesses and wealthy individuals, although HMRC is getting extra funding for staff, so they're determined to start closing the tax gap!
The upcoming UK Budget on the 30th of October is set to bring about some significant changes and impacts. From the economy and taxes to government spending and other key areas, there is much to look out for.
Budget 2024 may be a one-day event, but its effects will be felt for a long time.
Until next time ...
ROGER EDDOWES Business Godparent
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Roger trained at Edward Thomas Peirson & Sons in Market Harborough before working at Hartwell & Co, followed by Chancery, as a partner. He started Essendon Accounts and Tax with Helen Beaumont in 2014 as a general practitioner with a hands-on approach.
Roger loves getting his hands dirty, working with emerging, small-to-medium and family businesses to ensure they receive the best possible accountancy advice. Roger utilises an extensive network of business contacts to leverage the best guidance and practical solutions.
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